Saturday, December 10, 2005
Russian Parliament Passes Law on Gazprom Liberalization
09.12.2005 MosNews - On Friday, Dec. 9, the State Duma, the lower house of the Russian parliament, passed an amendment to article 15 of the federal law "On gas supply", thus lifting restrictions on non-resident ownership of shares in natural gas monopoly Gazprom and paving the way for Gazprom share market liberalization. A total of 335 deputies voted in favor, with 80 voting against and no abstentions. The amendment will end the division of the Gazprom share market and lift the restriction on the amount of shares in the company that can be owned by foreign companies and citizens. At the present time foreign ownership of Gazprom stock is limited to 20 percent, and foreigners can only buy Gazprom ADRs which trade at a premium to domestic shares. The Russian stock market also awaits liberalization, because at present Gazprom shares can only be traded on the St. Petersburg stock exchange, and not in Moscow. Gazprom liberalization was promised by President Vladimir Putin back in September 2004, but the process was constantly delayed. The price of Gazprom shares kept growing on expectations of liberalization and now the gas monopoly's market capitalization exceeds $100 billion. Still, some experts say that following liberalization Gazprom's market capitalization should be no less than $600 billion.